According to Savills latest Big Shed Briefing, take-up of warehouses over 100,000ft2 plus in the East of England rose 136% above the long-term annual average to hit 2.66 million ft2 in 2021.
The primary driver for this, reported Savills, is the recent granting of Freeport status to Freeport East.
Savills’ industrial director in the Eastern region Phil Dennis, said: “The Freeport East announcement will continue to drive requirements, in particular along the Eastern stretch of the A14 corridor, which is already seeing unprecedented levels of demand as a result..”
In a recent interview with Logistics Manager, Ben Oughton, development director at Jaynic, which has several scheme’s in the region including the 2.3 million ft2 Gateway 14 development at Stowmarket, said: “Such is the strength of demand that schemes with an original expectation of lasting 10 – 15 years look to be filled in a four or five year period.”
The developer has one last plot totalling 15 acres at its 2 million ft2 Suffolk Park scheme in Bury St Edmunds. The developer only submitted outline planning for the 114-acre Suffolk Park five years ago in January 2017.
Key deals across the region saw MH Star and Oatly Group AB taking 226,000ft2 and 385,000ft2 respectively at Peterborough Gateway, the former 735,000ft2 Debenhams unit in Kingston Park Peterborough let to Amazon and a 76,000ft2 pre-let to Hermes at Jaynic’s Suffolk Park.
Since being granted Freeport status in March 2021, the East of England has seen an increase in enquiries from a diverse range of occupiers looking to take advantage of the benefits afforded by being located on one of the designated schemes. These include Jaynic’s 156 acre site, Gateway 14, in Stowmarket and Curzon de Vere’s Port One Logistics Park in Great Blakenham.
As a result of this high level of activity, supply has fallen by as much as 33% in the last 12 months. Currently there is 985,000ft2 available across three units, equating to just under five months’ worth of supply. What’s more, 60% of existing stock is categorised as Grade C. Due to these constrains quoting rents have increased by up to 16%, at £7 per ft2.
To remedy this, the growing focus on the region has translated into a significant development pipeline. There are currently seven speculative units totalling 1.48 million ft2 under construction including 473,000ft2 being delivered by Firethorn at Peterborough South and a further 160,000ft2 at Suffolk Park.